Ias 38 – 2021 Issued ifrs standards (Part A)

Internally generated brands, mastheads, publishing titles, customer lists
and items similar in substance shall not be recognised as intangible assets.
Expenditure on internally generated brands, mastheads, publishing titles,
customer lists and items similar in substance cannot be distinguished from
the cost of developing the business as a whole. Therefore, such items are not
recognised as intangible assets.
Cost of an internally generated intangible asset
The cost of an internally generated intangible asset for the purpose of
paragraph 24 is the sum of expenditure incurred from the date when the
intangible asset first meets the recognition criteria in paragraphs 21, 22 and
57. Paragraph 71 prohibits reinstatement of expenditure previously recognised
as an expense.
The cost of an internally generated intangible asset comprises all directly
attributable costs necessary to create, produce, and prepare the asset to be
capable of operating in the manner intended by management. Examples of
directly attributable costs are:
(a)
costs of materials and services used or consumed in generating the
intangible asset;
(b)
costs of employee benefits (as defined in IAS 19) arising from the
generation of the intangible asset;
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IAS 38
© IFRS Foundation
A1503

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(c)
fees to register a legal right; and
(d)
amortisation of patents and licences that are used to generate the
intangible asset.
IAS 23 specifies criteria for the recognition of interest as an element of the
cost of an internally generated intangible asset.
The following are not components of the cost of an internally generated
intangible asset:
(a)
selling, administrative and other general overhead expenditure unless
this expenditure can be directly attributed to preparing the asset for
use;
(b)
identified inefficiencies and initial operating losses incurred before the
asset achieves planned performance; and
(c)
expenditure on training staff to operate the asset.